5 Ways to Pay Off Your Mortgage FAST!
What if I told you that you could pay off your 30-year mortgage early? Hi, I'm Tonya Harbin with Tonya Harbin Real Estate. These are the top five ways that you can pay off your mortgage quicker, because not only do we want to sell your home for the most money, but we want you to pay off your mortgage faster so you're not paying unnecessary interest over the life of your loan. The number one way to pay off your mortgage faster is refinancing to a shorter term. What I always recommend is refinancing from a 30-year term to a 15-year term. Your mortgage payment will go up, but it isn't really that much of an increase when compared to how fast you pay it off. In fact, you're going to pay it off 15 years faster. But the best part is all the extra equity and wealth you're going to be building by cutting off 15 years of payments to your lender. They're also going to sell you a lower interest rate. So right now, interest rates on a 30-year loan are around 3% on a 15-year loan. You're going to be able to get somewhere around a 2.3% interest rate, which is massive amounts of savings on the life of your loan. The second way is to make additional payments or pay extra towards the principal of your loan. So I've got an example for you. Say your mortgage is 300,000 at a 4% interest rate if you make an extra 250 dollar a month payment. So principal payment toward your loan, you're going to save $59,000 and interest. That is definitely worth repeating if you make $250 a month extra towards the principal balance of your loan. You're going to save $59,000 in interest over the life of your loan. Wow, that's a new car worth of interest. How can you pass that up? The third way is to make biweekly payments. You'll need to get approval from your lender before you start. But if you do this, you're going to actually trick yourself into making an extra payment a year. payments. Number four, recast your mortgage. Well, what does that mean recasting your mortgage when you make a large lump sum payment toward your principal amount when you recast it? Meaning your payments are going to be based on the new lower principal balance. So most people would do this after receiving an inheritance, or maybe a large bonus from work, but not all loans are eligible for this option. So make sure you talk to your lender about recasting your mortgage. The fifth way you can pay off your mortgage in the next 60 to 90 days is to sell your home when you sell your home. The buyer pays off your mortgage, and in today's market, you will have a large lump sum payoff of cash in your pocket. This is brilliant. Now you're probably asking Tonya, Where am I going to live? And won't I still need a mortgage? Well, where do you want to go? Is there a better location? A neighborhood school district or even a better town? Maybe you just want a bigger home that better fits your needs, and your house is most likely worth more than what you owe on it. And you can put the profit of your old house towards buying a brand new one. If you have any questions or want to know exactly what your home is worth. Just give us a call. Our number is 325-603-3550. I look forward to hearing from you!